As the Q4 2024 pharma earnings period rolls on through the first month of President Donald Trump’s second term, executives find themselves faced with policy questions ranging from the Inflation Reduction Act to RFK Jr.
Pfizer CEO Albert Bourla and President Donald Trump go way back to the days of Operation Warp Speed. So, as the new president lays out his priorities in the first few weeks of his second term, the pharma CEO expressed confidence that they can still work together.
That sentiment was echoed across pharma company earnings calls this month as the fourth quarter reporting period wears on. Bourla was among the CEOs asked to speak to the new administration’s many policies affecting the industry, particularly as Robert F. Kennedy Jr.’s controversial nomination to run the Department of Health and Human Services (HHS) was cleared to head to the full Senate during Pfizer’s Feb. 4 call.
“I have a very long-lasting relationship with the President that was cemented during Operation Warp Speed when we developed the vaccine for COVID, and I know that the President is very proud of what he was able to accomplish, and he has made public statements on that,” Bourla said on the call.
Bourla also referenced a dinner where Trump introduced him to RFK Jr., and the Pfizer chief “tried to understand his views.” Bourla said he focused not on where they disagreed, but on where they can agree, on initiatives like chronic diseases, cardiovascular diseases and cancer. In subsequent meetings with RFK Jr., Bourla said he spotted opportunity for collaboration.
“Do I expect that we will agree on everything on vaccines? I don’t know,” Bourla said. Given all of the statements made by RFK Jr. and the administration, Bourla said he believes he will have “a way more tempered view on how to interact with the vaccines.”
Asked specifically about RFK Jr.’s statements on removing vaccine liability protections that shield companies from injury claims for their products, Bourla said any changes would need to go through Congress.
If RFK Jr. does make any moves in this area, “I think that he won’t find in front of him the industry, he will find in front him the total medical community and the total scientific community and payers, that they don’t want to see a reduction in vaccination because that’s a very cost-effective way of controlling healthcare costs,” Bourla said. Moreover, the Trump administration does not want to see another health crisis, he added.
Bristol Myers Squibb CEO Chris Boerner on his company’s earnings call pledged to work with Trump and RFK Jr., particularly on ensuring the FDA “has what it needs to fulfill its mission.”
IRA and Tariffs
One policy the industry has been outspoken against is the Inflation Reduction Act (IRA), passed and signed into law by President Joe Biden in August 2022, which included provisions to start negotiations of drug prices under Medicare. Trump has begun chipping away at some portions of the IRA’s wider mandates but has yet to clarify his intentions on the drug pricing issues.
After going through the first round of price negotiations, Boerner said he has notes for the new administration. BMS has been candid in its criticism of the law, even joining a lawsuit along with peers AstraZeneca and Johnson & Johnson to challenge its constitutionality.
“We see the need to have a number of fixes that will avoid some of the more damaging aspects of the law and some of the more perverse incentives,” Boerner said, adding that addressing the bill and the spillover impact are some of the key things BMS will be focused on.
Regardless of how the law evolves, Takeda CEO Christophe Weber said the U.S. will always be the top market for new medicines.
“We believe that the U.S. . . . will remain absolutely vital for an innovative company and R&D-driven company like Takeda,” Weber told investors on a January 30 earnings call. “It’s a country where new innovative medicines have the fastest launch, and this is where we have the highest level of innovation recognition and reward for innovation. It’s very important.”
Pharma leaders were also peppered with questions about Trump’s proposed tariffs, which would levy steep fees on imports of certain materials and products to the U.S. Active pharmaceutical ingredients and pharmaceuticals could be subject to those fees, although the true breadth remains unclear. Several companies pointed to a fast-moving situation, with plenty of unknowns.
“It’s difficult for us to comment on something that is not real today,” Sanofi CFO François-Xavier Roger said during the company’s earnings call. But he admitted that Sanofi has significant exposure to the U.S., with 25% of products the company markets worldwide coming within the region.
Weber admitted the tariffs could have an impact on Takeda’s business as well. “At Takeda, we have a manufacturing network focused on U.S., Europe, Singapore and Japan. It’s a global network which was built on the premise of free trade,” he said. “If there are more forces against free trade, we’ll have to adapt over time.”
At Merck, CFO Caroline Litchfield said the New Jersey pharma has global operations with limited exposure to China, Canada and Mexico, which have been the key targets of Trump’s proposed tariffs.
Eisai, another Japanese pharma, also faced these questions, with executives simply saying they are engaging with their staff on the ground in Washington, D.C. to learn more.
On the biotech side, leaders have been more outspoken, especially after the Trump administration moved to slash funding to universities, medical centers and other institutions for medical research. On Monday, a U.S. judge blocked the move before the cuts could take effect.
A community of biotech leaders signed on to a petition started by the advocacy group No Patient Left Behind to defend the National Institutes of Health and National Science Foundation, calling Trump’s actions “an assault on the foundation of biomedical and technological progress.”
